The Auditor-General's damning indictment of deception and mismanagement over the F-35 fighter-jet program not only damages the Conservatives' reputation for probity, it also discredits their extreme rhetoric against the opposition. Because the opposition was right.
Stephen Harper has now moved swiftly to place the procurement on a sounder footing. But the revelations of false estimates and suppressed information, coming only days after an austerity budget, could tarnish the Conservative brand like nothing that has come before.
A government that promotes itself as a responsible steward of the economy has bungled the biggest and most important contract on its watch. A Prime Minister who practically branded criticism of the F-35 acquisition as treasonous must now deeply regret, and will have to eat, his words.
And critics have fresh and powerful ammunition when asking why Finance Minister Jim Flaherty's budget slashes government programs and downsizes the public service even as the Conservatives commit tens of billions of dollars to buying warplanes without knowing what they're getting for the money.
Mr. Harper can only be grateful he has a majority government and three years left to try to make things right.
Michael Ferguson, in 35 grim pages, exposes a Department of National Defence committed to acquiring the Lockheed Martin F-35 Lightning II aircraft, and willing to obstruct, obfuscate and mislead in order to suppress any alternatives.
Confronted with this approach by the department, the Harper government made two terrible mistakes. The first was to buy the military's analysis without looking deeper into it. Civilian politicians allowed themselves to be hornswoggled by brass hats and bureaucrats.
The second mistake was to turn the F-35 into a political wedge issue. The Conservatives not only defended the purchase; they lashed out at anyone who questioned it, accusing them of being at best ignorant or at worst disloyal.
When Kevin Page, the Parliamentary Budget Officer, projected costs for the F-35 that turned out to be far closer to the truth than what the government was offering at the time, the Conservatives dismissed his report as "illogical" and "speculation."
When Mr. Harper, who was touring an aerospace manufacturer to promote the F-35, was asked about Liberal calls for a full review of the program, he angrily replied that critics were "playing politics with the lives of our men and women in uniform and the jobs of the people in this room, and we will not stand for it."
He should have stood for it. A review in 2010 might have revealed mistakes and abuses already far advanced. Instead, Mr. Harper, having used the issue to raise the political stakes, must now endure the political fallout.
In response to the Auditor-General's indictment, the government has frozen spending on the program, stripped National Defence of responsibility for it, and handed that responsibility to a committee of deputy ministers.
A similar arm's-length procurement process for naval and Coast Guard vessels earned the government high marks. But with Mr. Flaherty's latest budget cutting or capping spending across the board, and with Conservative credibility on the fighter program shot to pieces, selling the need for the new jets, new ships or new anything else will be a much harder job.
Whatever the jets may ultimately cost in dollars, the political price of this bungle could be very high indeed.